What a week we’ve just come out of! Brexit, the pound, the euro crash, Cameron, Boris, May, Corbyn, Gove, Boris again, fears of recession and on top of that, suggestions that London could lose its crown as the FinTech capital of the world.
But wait, is it really that bad? First up, the government has responded well and FTSE has just hit its highest point this year. The pound is at a low, which will drive inflation, but will simultaneously make it easier for British companies like us to export our services competitively. And here is the unexpected story – the FinTech industry will thrive. We’ve just had our best month on record. Our FinTech clients are transacting at record levels, up 7% on May, our team is on a high after moving into new offices and our NPS results are in - our clients are happier than ever.
What does this tell us about FinTech in the UK?
Firstly, nothing has changed for the already booming FinTech industry. Clients are still transacting, maybe different currencies and at different prices, but most FinTech firms are somewhat removed from the crazy volatility of the trading markets. And here is the core point - FinTech firms are serving a market need that really exists, and that simply doesn’t disappear overnight. FinTech is built on a bedrock of core principles that transcend economic cycles - changing client demand, better technology and a regulatory framework that creates an environment of competition.
And that leads me to my second point, which is that some of the best and brightest new technologies come out in times of turmoil. Difficult times require new solutions and innovative thinking. The current FinTech boom was arguably a result of the 2008 crash, and as an industry we are well placed to weather any storm. The core tenets of the FinTech proposition, competition, transparency, frictionless experiences are all messages that resonate especially loudly during tougher times.
Hey let’s not kid ourselves - there will be challenges, but we’ll overcome them. At Currencycloud, we will address fears of FCA licenses losing their European standing by securing regulation across Europe; we will protect our staff in London; we will grow our global footprint outside of Europe. Our clients will face new challenges, and we will respond to help them adapt.
The impact of the Brexit will undoubtedly be felt most by either ends of the spectrum – the smallest emerging start-ups and the largest global banks. The latter, with their complex operations, multiple regulators and reliance on clearing Euros in London, will spend time and money adapting to whatever comes. Already two of the biggest banks – HSBC and Barclays – are pledging their allegiance to the UK.